CHANGES TO IMMIGRATION CHECKS

ALLOW ONLINE RIGHT TO WORK CHECKS

Organisations have a duty to prevent illegal working and, in order to do so, carry out ‘right to work’ checks on their prospective employees to gain a statutory excuse against liability under the civil offence. This check is conducted using documentation provided by individuals, with the government’s three-step checking process requiring copies to be made of these documents. For certain documents provided, organisation will also be required to carry out a follow-up check as their statutory excuse will be time-limited.

Introduced in April 2018, organisations could use the Home Office’s online right to work checking service, alongside receiving the statutory documents, to carry out their right to work check. With effect from 28 January 2019, organisations can rely solely on the online service to carry out right to work checks, without receiving any documents from the individual. The document checks will continue to apply however where the individual’s immigration status cannot be checked online.

To gain the statutory excuse using the online service, organisations will have to:

  • use the service for each individual and only employ, or continue employing them, where the online check confirms they have the right to carry out the work in question
  • be satisfied that the photograph on the online check is consistent with the appearance of the individual
  • retain and keep a clear copy of the online check response for the period of the individual’s employment and for two years after. This can either be held electronically or in hardcopy.

Where the online checking service is used to employ students, organisations will still require details of academic term dates. Additionally, a follow up online check will have to be carried out in advance of a time-limited statutory excuse expiring.

Where the online right to work check is negative, ie it shows that the individual does not have the right to work in the UK and/or to do the work in question, the organisation will not gain the statutory excuse against civil liability where they employ, or continue to employ, the individual. Where right to work checks cannot be carried out online, such as where there is an outstanding application, appeal, or review with the Home Office, organisations will continue to be required to contact the Employer Checking Service to receive a Positive Verification Notice, providing a six-month statutory excuse.

Additionally, from 28 January 2019, organisations are no longer required to receive full birth and adoption certificates from UK nationals when carrying out document checks. The List A documents have been updated to allow UK individuals to provide their prospective employer with either full or short-form certificates, alongside an official document containing their National Insurance number, to establish a continuous statutory excuse for the length of their employment. This change is aimed at making documentary checks easier for UK citizens who do not have a passport.

Employment Legislation for April 2019

April is a fairly busy time for HR professionals and business owners alike. Are you fully prepared for legislative changes that could impact your business. This is a time when new rules come into force, so you need to be prepared and you need to take action.

Here’s what you need to know:

Increase in National Minimum Wage rates

From April 2019 the minimum contributions for auto-enrolment pension schemes will increase for both employers and employees. Currently, automatic enrolment requirements mean that employers must contribute a minimum of 2% of an eligible worker’s pre-tax salary to their pension pot, with the individual contributing 3% themselves. However, under the new requirements, employers and employees will now have to contribute a minimum of 3% and 5% respectively. 

Both the National Living Wage (NLW) and National Minimum Wage (NMW) rates will increase in April 2019. Under the new NLW, the minimum hourly rate that workers aged 25 and over are entitled to will increase from £7.83 to £8.21. At the same time, the NMW rate for workers aged between 21-24 will increase from £7.38 to £7.70 an hour; the rate for 18-20 year olds will increase from £5.90 to £6.15 an hour and those over compulsory school age but not yet 18 will experience an hourly increase from £4.20 to £4.35. The minimum rate for apprentices will also increase from £3.70 an hour to £3.90 an hour, providing the apprentice is under the age of 19, or 19 and over but in the first year of their current apprenticeship.

Settled Status for EU nationals

Auto-enrolment contributions

European workers currently living in the UK will be able to apply for settled status in 2019, allowing them to remain indefinitely in the UK following the end of the Brexit transition period in 2021. To be granted settled status individuals must be able to prove they have been living in the UK for 5 years by the date of application. Those who do not meet this requirement can apply for temporary status, allowing them to remain until they have accrued enough residency to be granted settled status.

Payslips

Changes to the way employers issue payslips will come into force on 6th April 2019 as from this date onwards the legal right to a payslip will be extended to include those who are recognised as workers. Employers will also be obliged to include the total number of hours worked on payslips for employees whose wages vary depending on how much time they have worked. 

Parental bereavement leave and pay

The government has confirmed that it intends to introduce a right for bereaved parents to take paid time off work. Under the current proposals, bereaved parents will be able to take leave as a single two-week period, as two separate periods of one week each, or as a single week. They will have 56 weeks from their child’s death to take leave.

The new right is expected to come into force in April 2020, but employers should start preparing for it during 2019. You could decide to introduce your own bereavement leave policy if you don’t already have one.

CEO pay gap reporting

New legislation will also come into force this year that requires companies with more than 250 employees to publish their executive pay gap. Although the first reports are not expected until 2020 businesses should be calculating the necessary figures throughout 2019 to show the gap between the total amount paid to their CEO and the average pay for an employee.

The Truth About Unpaid Internships

Employers could be breaking the law if they continue to offer unpaid internships, experts have warned.

The warning came after a survey from the Sutton Trust found that of employers offering internships, almost half said they were unpaid positions.

Just over a quarter offered expenses only internships and 12% no pay or expenses whatsoever.

The Pay As You Go survey found that both graduates and employers are confused about the current law on unpaid internships. Under national minimum wage legislation, interns must be paid if they are expected to work set hours or on set tasks. Up to 50% of employers and 37% of graduates surveyed were not aware that most of such unpaid internships are likely to be illegal.

Retail had the highest proportion of unpaid internships at 89%, followed by the arts, 86% and the media, 83%.

Only 26% of IT & telecoms and 32% of manufacturing internships were unpaid.

The research found that graduate internships appear to be on the rise, with 46% of 21-23-year olds have been employed this way, compared to 37% of 27-29-year olds. Younger graduates are also more likely to have taken on more than one internship. According to the report, there are around 100,000 interns working in Britain every year, with around 58,000 unpaid.

The survey comes as a bill to ban unpaid internships over four weeks in length is brought to the House of Commons. It would like to see all internships longer than one month to be paid at least the National Minimum Wage of £7.05 for 21-24-year olds, and ideally the Living Wage of £9 per hour.

In addition, the report recommends that internship positions should be advertised publicly, rather than filled informally and recruitment processes should be fair, transparent and based on merit.

Sir Peter Lampl, founder of the Sutton Trust and chairman of the Education Endowment Foundation, said: “Unpaid internships prevent young people from low and moderate-income backgrounds from accessing careers in some of the most desirable sectors such as journalism, fashion, the arts and law.

“This is a huge social mobility issue.  It prevents these young people from getting a foot on the ladder. The legal grey area around internships allows employers to offer unpaid internships with impunity. That is why the law should be changed.”

5 things every manager (of people) should know

Being a manager can be both a tough and a highly rewarding job. Often the result of a promotion coming after hard work. Or a brand new role in a new organisation.  But rarely does the status of manager come with a tight brief and any training. Most managers learn the hard way about what is expected of them and for many their main source of development is how they have been managed; well or badly.

If every manager understood the following 5 things clearly their chances of being successful and effective would significantly improve which in turn would have a powerful knock on effect across the company.

What their purpose is

When we audit companies we often ask the CEO and other senior people, what the purpose of different roles are. We also ask the individual doing that role. Often the definitions don’t match. Sometimes it sounds like two different jobs to us. If you do nothing else, make sure you can articulate the purpose of the manager’s role.

Often explanations talk about production, technical expertise, sales targets, quality but rarely do they talk about responsibilities for the people being managed. It can be seen as Business as Usual – ie in addition to other expectations on the manager meaning it will be a low priority. Which will impact on the whole culture of the organisation and not in a positive way.

What they can and can’t do

This might seem obvious but it rarely is.  We are talking about whether they can hire and fire, what their budget is, whether they can arrange training and promote people. Are they free to discipline their staff or must this be culturally approved? What isn’t written on the job description or needs to be explained?

What vicarious liability is and how it might impact on them

Vicarious liability refers to a situation where someone is held responsible for the actions or omissions of another person. In a workplace context, an employer can be liable for the acts or omissions of its employees, provided it can be shown that they took place in the course of their employment.

Many employers are unaware that they can be liable for a range of actions committed by their employees in the course of their employment – these can include bullying and harassment, violent or discriminatory acts or even libel and breach of copyright. It’s also possible to take action against an employer for the behaviour of third parties, such as clients and customers, provided these parties are deemed to be under the control of the employer.

The key question of any case of vicarious liability is whether the employee was acting in a personal capacity, or in the course of their employment. This can often be difficult to determine. Nor does an employer’s liability end once the employee leaves the organisation – as the law stands, action can still be taken against an employer even though the person in question no longer works for them.

What their H&S responsibilities are

Under the law employers are responsible for health and safety management. For every employee this responsibility lies with their manager. Even if there is a H&S Advisor. It is the managers that have the responsibility on a day to day basis because it is the employer’s duty to protect the health, safety and welfare of their employees and other people who might be affected by their business.

This means making sure that workers and others are protected from anything that may cause harm, effectively controlling any risks to injury or health that could arise in the workplace which includes managing and monitoring stress. Also managing sickness absence and understanding when an employee may need to be offered reasonable adjustments if they have a special need or a disability, and it might help them remain at work.

Employers also have duties under health and safety law to assess risks in the workplace. Risk assessments should be carried out that address all risks that might cause harm in your workplace.

What the unwritten rules are

Often the unwritten rules or internal ways of working are the biggest keys to success or failure. Knowing them is a start. Often politics is a key part of this. Who to know, be connected with. Who to avoid upsetting. How the organisation deals with conflict and disagreements. How the culture dictates the ways of working for the organisation.

We get involved in situations where managers haven’t worked out and often failing to understand and comply with unwritten rules (obvious to everyone apart from the manager) is sited. Imagine being told it was all over for failing to comply with rules that no-one told them about.

Often a solution to tackling any of these issues that you recognise can be signing up to an HR audit and a bespoke management training programme. So that you know your managers are being supported but also that what they are being taught and guided on is appropriate and on brand for your company.  This can be in conjunction with senior leaders and any internal HR function.

The good news is Amelore offer this service so do get in touch if we can help and advise you further.

GDPR AND IMMIGRATION PROCESSES

Most employers will be aware of the upcoming introduction of the General Data Protection Regulation, or GDPR. But how can they be sure the way they collect and store information for immigration purposes will be compliant? Amelore look at the key risk areas.

GDPR

The introduction of the General Data Protection Regulation (GDPR) presents a huge challenge for employers in many data processing scenarios.

Not surprisingly, immigration processes necessitate the collection and processing of considerable personal data by an employer and, in many situations, one or more third parties such as legal advisers.

And with the deadline (25 May 2018) fast approaching, there is a chance that certain types of personal data processing will not be captured in your thinking, and will therefore create a risk of a breach.

For many employers, immigration is a niche activity that changes constantly and is therefore difficult to fully understand and account for with internal policies and processes.

However, given the sensitive nature of data collected and processed, and the multiple parties often involved in this, now is the time to look at key immigration activities and ensure that they are GDPR compliant.

Here are a few scenarios that illustrate the wide range of immigration data points to be accounted for in preparing for GDPR.

Right to work checks

Employers must conduct right to work checks on any new employee, ideally before they start working for you so you only employ people with the ‘right to work in the UK’.  Employers should take copies of any original documentation they see and copy, sign and date the document copy which should then be securely stored.

While it is easy to assume that this is covered by a “legal obligation” that is not actually the case.

A right to work check is done to establish a statutory excuse against a civil penalty – that is, to avoid a fine should an employee be found to be working illegally. It is not strictly speaking a legal requirement to perform a right to work check and there are no penalties for failing to perform a right to work check where the employee is working legally. However, employers that do not carry out right to work checks will not have a statutory excuse.

Therefore, the retention and processing of data relating to immigration status would be categorised under “legitimate interests” and this processing should be covered in a privacy notice.

Resident labour market test

The resident labour market test (RLMT) is conducted as part of a Tier 2 General (new hire work permit) application to justify the recruitment of a non-UK/EU individual, ahead of a UK/EU individual.

The employer generally needs to place two adverts on two websites for 28 days each, and then assess applications against the skills, education and experience described in the advert.

If there are no suitably qualified candidates from the UK/EU, then a non-UK/EU individual can be offered the role and be sponsored under Tier 2 General.

Documentation, including job applications, CVs and interview notes need to be retained for up to seven years in the event that the Home Office conducts a compliance audit.

Now imagine you were one of the candidates who applied for that role. You were interviewed for the job but ultimately were unsuccessful. It would be reasonable to expect that your details would be retained for a reasonable period, for example six months, to allow the employer to defend any challenges arising from the appointment.

However, most candidates would be surprised to learn that their personal information would be stored for up to seven years and shared with legal advisers and the Home Office as part of the immigration process for the successful candidate.

While employers may be able to argue that retaining the information is a legal obligation, the Home Office document that describes document retention is not technically part of the immigration rules. Rather, it is a policy document and therefore it may be open to interpretation whether it is a legal obligation or not.

As such, employers may instead have to rely upon “legitimate interests” as the appropriate legal basis to retain such information. This of course requires a proper assessment to ensure those interests are not outweighed by risk of prejudice to individuals.

What steps do employers need to take to ensure that their RLMT processes are GDPR-compliant?

  1. Ensure your privacy notice for recruitment purposes makes clear the possibility of personal data being processed and retained for the purpose of immigration requirements, specifically the RLMT for Tier 2 General, including the sharing of that data with legal advisers and the Home Office, and the length of time data may be stored.
  2. Minimise personal data where possible. The personal data that must be retained on file, as per the relevant Home Office policy document, relates only to applications shortlisted for final interview – rather than all candidates who responded to the advert. Likewise, do not ask for personal data that is not strictly required at this stage of the process, for example, copies of passports, immigration documents and evidence of qualifications and experience.
  3. Redact and anonymise personal data. A further way to minimise the personal data you hold is to redact information that is not relevant to the information you need to retain, such as contact details, interests and hobbies.

Immigration enquiries and opinions

Throughout the course of employment an employee can expect that their employer may need to consult with legal advisers and other professional advisors on a range of matters, including immigration, and in doing so may need to share personal data.

This should of course be covered in the section within the privacy notice dealing with disclosures to third parties.

However, what if as part of these enquiries it is necessary to transfer data outside the European Economic Area (EEA)? For example, where the organisation is looking to transfer an employee to the US and would like a US-based immigration lawyer to assess eligibility.

Transfers of personal data outside the EEA need to be addressed within privacy notices. Also, any such transfers of personal data should only take place where steps are taken to ensure adequate protection for that personal data in the recipient country (this is also the existing position under the Data Protection Act 1998).

With just over a month to go until GDPR goes live, now is the time to understand the data points in your immigration processes and ensure they are GDPR compliant.

What every manager wants to avoid

In our work, we audit any new company we work with and have observed that a common theme in many is that managers don’t appear to want to manage.

By that we mean managing people. Setting standards on performance and monitoring them, holding employees to account, identifying what behaviours are needed to create the right culture to grow the business and being confrontational if and when it is necessary. Or they are only embracing the nicer side of management. Giving out pay rises and promotions etc

Managers and leaders seldom avoid this type of work for any other reason than they don’t know how to do it and are worried about getting it wrong. Often employees pick up on a fear and become experts on how to make the most of this which is rarely beneficial for the manager or the company. Equally managers aren’t set any targets or held to account about whether they do it (well) or not. So they will naturally focus on what is valued.

As we are all aware, being good at a technical or specialist role can often lead to promotion into a completely different type of role. Leading and managing a team is so much more than being the most senior member of it with the biggest say. The person that earns the most does so because they also have significant people management responsibilities and are accountable for their team as well as business area. Rarely is this properly explained. During recruitment or promotion discussions. Usually the elephant in the room and therefore often misunderstood.

No training or guidance for managers

Here are some of the things that managers have often had no training or guidance on whatsoever:

  • A core understanding of management theory and what is relevant to their company and industry
  • How to delegate and communicate effectively
  • An understanding of their obligations and duty of care under employment and health and safety legislation
  • How to turn key organisational KPI’s into objectives or targets for staff
  • The difference between technical and behavioural competence
  • How to understand and harness the power of personality
  • How to select staff – interview competentantly, understand and recognise unconscious bias and discrimination. Understand the equality act.
  • Motivational techniques and team building

It stands to reason that if you don’t know how to do something you may avoid it or try and get someone else to do it. Particularly if you fear negative consequences for yourself. Or if you observe that no-one else is tackling similar issues.

Revolving door culture

But as many will be aware, not doing something often has a bigger impact on your culture than doing something, even if it’s not perfect. Not tackling people management issues will build up over time until you start to observe that your good people are leaving. You will replace them of course. At considerable time and expense. And then your fanastic new hire might leave before their probabtion period is up and you start to wonder if it’s something in the business.

The truth is that it’s your culture. How you do things. What you avoid or ignore.

Targetted development

But you can address the fear and reluctance of maangers with some targeted management development training. A core part of that should be an assessment of whether you have the right poepe in lead roles.  Often you will have and they just need devellping. But some people don’t make or want to manage people. No matter how much you spend on core Leadership programmes. However they may be suited to a different specialist role? Or have a No 2 that is interested?

What provider to pick?

There are plenty of companies around who specialise in leadership and management development training. Many long established and many newer ones coming through.

Talking to CEO’s about their previous experiences of such engagement they often report that many staff enjoy attending such initiaitves but they rarely had a long lasting effect as they often didn’t address the following issues:

  • Who held managerial posts
  • What their remit was v what they did
  • Whether the corporate structure was correct
  • What the culture was (desirable v actual)
  • How they would be managed post the intervention

It was hard therefore to quantify any return on the investment made often because the desired outcome hadn’t been pinned down or properly understood.

Our approach

At Amelore, supporting organisations to develop managers has become a growing area for us.  We usually work with companies that are already established and performing well but who want to develop their management team and culture to create space for a senior team to focus on the strategy. Often they don’t have an HR Director in their business.

Our work as external HR professionals can involve us recruiting new managers and coaching key individuals along side regular internal workshops. We can honestly say that every company has different needs and consequently different programmes.

What we bring is our insight into how to make companies work better which we’ve gained over many years. And our HR expertise.  And just like Mary Poppins, we stay as long as we are needed. Ultimately our aim is to leave that company in a good place to grow, compete and innovate. To give it competitive advantage because it works as well on the inside as the outside.

Your Recruitment Options

Hiring the right people is as significant to the success of a company as the business model and health of the balance sheet.

Recruitment is a highly lucrative unregulated and fast growing industry. It is important therefore for companies to understand the different options available to them, the costs as well as the benefits and any downside of the choices they make.

Common recruitment mistakes

Organisations in high growth mode often run very inefficient and costly recruitment processes with little thought for the candidate experience even though it is a seller’s market.  Multiple repetitive interviews, waiting until vacancies have been created to start a process and failing to assess candidates thoroughly are typical.

Some Key Facts

The CIPD (Chartered Institute of Personnel and Development) in partnership with Hays Recruitment, conducted a Resourcing and Talent Planning survey in 2015.

Resourcing and talent management in current economy “an employee’s market”

  • Half of CEOs have recruitment & talent management as a priority;
  • Three quarters are recruiting key talent/niche areas;
  • Growing demand for labour – more than half expecting headcount to increase;
  • Skills shortages are escalating – four-fifths feel that competition for talent has increased;
  • Lack of specialist or technical skills & lack of sector/industry or general experience were common problems;
  • Organisations are increasingly required to be creative in both their search for candidates and the packages they offer.

What are your recruitment options?

Your network – Many companies use their personal network to find staff and this can be very effective. However it can also lead to skills shortages and complications with personal relationships.

Advertising on line – Companies may advertise via online sites such as Linkedin, Indeed, Monster, Fish4jobs etc  This has the benefit of advertising that your company is busy and hiring but can create a lot of administration.

Recruitment Agencies – You won’t have been in business long before the sales calls start.  When choosing an agency, try and get a recommendation and check their credentials. Anyone can set an agency up with no qualifications or experience. If things like diversity and inclusion are important to your company make sure you ask about this.

Executive Search or Headhunters – This is usually used for senior or specialised roles due to the cost. Finding a firm that understands and challenges you is worth a lot. Meeting a few firms and interviewing them can be helpful.

Independent HR company or freelance individual – Many experienced HR professionals have strong recruitment experience gained from working in-house. A key component of recruitment is identifying the passive candidate.  You pay a day rate for experienced professionals to find and speak to candidates for you.

They will often also manage the entire process for you, even if you work with an external recruiter. Always a cheaper option but requires an investment in developing knowledge and relationships so the right candidates are identified. Key factor here is that there is no placement fee so no pressure to put up salaries or package to enhance the fee.

What is the difference between Executive Search and Recruitment Agencies?

The aim of Recruitment Agencies is to fill a position with the best available person. Recruitment agencies source from a pool of candidates that are actively looking for a new challenge by advertising on various platforms. This leads to a group of candidates that are “self-selected” of which the selection was not pre-determined by the company.

The aim of Executive Search consultants is to locate and recruit the best person, regardless of whether he or she is already employed or seeking a new position.

This approach can broaden and deepen the talent pool available to a search firm’s clients and places the control of who should be part of this talent pool, squarely in the hands of the client company.

There may also be the use of specialised psychometric tools, resources and skills to enhance the selection process.

The costs

Executive Search and Recruitment Agencies tend to charge a percentage fee or a retainer.

The percentage fee is based on the starting salary of the candidate and is normally payable once the candidate starts work with you. This form of charging is most common and if you don’t find a suitable candidate, you don’t have to pay the agency anything.

However, fees can vary from 8-25% depending on the agency and the salary. If you choose a retainer fee, it is agreed at the outset; with a percentage being payable upfront and the remainder due when the candidate starts their employment.

If you are using an independent HR consultancy you won’t pay a placement fee. Just a day rate which almost always works out cheaper.

Looking ahead

It is important for companies to understand and cultivate their ability to read market conditions, trends, movement and fluidity in order to develop and manage effective recruitment strategies. Needs changes as companies grow and it is important to regularly review this.

The truth about Tribunal Indemnity Insurance

Many busy SME owners choose outsourced HR providers based on the fact that Tribunal Indemnity Insurance is offered and so they feel they have mitigated against a potential financial risk and made a good choice.

However many don’t fully understand what this insurance is and the impact on their business of signing up to such a service. They also have little idea of what risks if any they actually have in their business of someone making a successful claim against them. This blog explains it further.

What is it Tribunal Indemnity Insurance?

Because employment law can appear complex and full of tricky loopholes, the scaremongers selling tribunal indemnity insurance often have a field day by playing on people’s fears of something that can in many circumstances be prevented.

Tribunal indemnity insurance takes various forms which range from insurance against all legal and compensation costs arising from a tribunal claim, to just simply covering legal costs or nothing at all because you didn’t follow their rules.

As with any insurance policy, the first step is to think about the risk you are insuring against. It’s an easy decision for an electrical firm with a warehouse near a river to insure against flood damage. If there’s a flood, all of the stock could be wiped out and the business could go bust. The risk is high, and so is the potential cost of the insured event.

For business owners, it’s not so easy to quantify the risk and potential costs of a tribunal claim, so they go for peace of mind, and take the insurance. The reality is that there are many steps in the journey to an employment tribunal, and an employer who has sensible HR policies and procedures in place, and follows them, is at a very low risk of losing an employment tribunal claim. Even if the employer loses the claim and has to make a compensation payment, the costs are often nowhere near as high as expected.

The claim with the highest sum awarded was in a sex discrimination claim. These are technically uncapped, and can also include awards for injury to feelings.  But the median award in 2016/17 for Sex Discrimination claims was £8,381and for Disability Discrimination it was £10,235. Although there will always be media stories about huge successful claims, they are rare, and the median award is a more realistic indicator of your potential financial risk. The median compensation payment for Unfair Dismissal claims in the same period was £ 7,521.

Three things you should know about Tribunal Indemnity Insurance

No 1 – You may not even need it

The electrical services company will not sit and watch the river rising or not worry about their stock, just because they have insurance. They will use sandbags, move the stock to higher shelves, and stand by with buckets to bale out the water as it flows in. Nobody wants to have to deal with the aftermath of a flood. It’s better to prevent the damage in the first place. If business owners took the same approach to people issues, and took notice and practical action early on, there would be little risk of a tribunal claim, and therefore little need for an insurance policy.

There are HR experts, like us, who can explain all the rules, and help managers to take each step carefully, ensuring that employees are treated fairly and that the needs of the business are also met. This is equivalent to using sandbags.

If managers are not capable of handling an issue with performance, or there is a persistent problem, such as bullying and harassment, then HR experts, can provide training, coaching and even hand holding to support them. This is effectively like moving the stock to higher shelves. But the effect is longer lasting as they are learning how to manage such situations and won’t be fearful of them.

If matters are so serious that the employee is likely to be able to make a claim at an employment tribunal, there are HR experts like Amelore, who can help the business to evaluate the risk of a successful claim, and mediate between the employer and employee.  If that doesn’t work/or it’s to late for that then they can negotiate the terms of a settlement agreement, making a financial payment to the employee to leave the business and waive all their rights to making a claim against you. This is not desirable, and does cost money, but still salvages the situation, a bit like baling water with a bucket. However often this will be much less than you think.

No 2 – Not all of your costs will be covered

If the tribunal claim goes ahead, there will be legal costs, but much more significantly, there will be huge management time lost in the preparation and aftermath of a tribunal – these costs will not be covered by the insurance. The impact on employee motivation, and even on management morale, which ultimately hits the bottom line of the business, doesn’t have a price, and therefore isn’t covered by the insurance.

Using a pragmatic, knowledgeable HR professional to avoid the problem will always be cheaper than paying a lawyer to fix it.

No 3 – Insurance companies don’t like paying out

The real nub of the issue is this – there are so many ‘get out’ clauses in the tribunal indemnity insurance, that an employer runs a real risk of thinking they are covered, only to find that the insurance company then gives lots of reasons why they won’t pay out.

If the insurance is offered as part of an HR service, there will be a big caveat stating that if the employer doesn’t consult the service provider and follow the employment law advice to the letter, the insurance will be invalidated.

This also means that the HR service provider is likely to sit on the fence, or tell their client what the law is, without committing to a recommendation, for fear of invalidating the insurance. So the whole process will go on and on whereas most SME’s need a quick resolution so they can focus on their business.

Some providers may even boast that they help their clients to make sure their paperwork is correct, so that if a claim goes to tribunal, they will have a ‘bundle’ already prepared, saving lots of time. It doesn’t save lots of time for the business owner or manager trying to do their day job and providing them with that paperwork.

In our experience the vast majority of employees are reasonable people, who in turn want to be treated reasonably by their employer. The vast majority of managers and business owners want to have happy, engaged employees.

Surely everyone’s time and effort would be better spent building good relationships, ironing out misunderstandings, and dealing in a reasonable way with problems, than filling in forms, following scripts and ticking boxes to make sure that the tribunal insurance is not invalidated?

Summary

So in summary our advice is if you are looking at HR outsourcing providers don’t base your decision on fear.  Fear of something you don’t fully understand. If anyone is selling you their services and using fear as their main incentive ask yourself why?

A good HR outsourcing provider will audit your business and then make clear practical proportionate recommendations to ensure you are legally compliant and have good HR practices embedded. This may involve training your managers. This significantly reduces the risk of a successful claim against your business.

Also take care that the outsourced HR provider you select doesn’t tie you into a long notice period as that will tell you something important about them. Long notice periods are designed to cover poor service. Most SME’s don’t have the time or the energy to battle their way out of a contract they have signed in a rush without understanding the potentially negative consequences.

If you do have an employee dispute and are supported by an outsourced HR provider that doesn’t offer Tribunal Indemnity Insurance, this will be dealt with swiftly and you will benefit from pragmatic commercial advice about your options and any risks.

At Amelore we don’t offer Tribunal Indemnity Insurance. We work with businesses and individuals and firm but fair. We have also never been successfully taken to an Employment Tribunal.  We are not complacent about that fact but we are extremely proud of it.

GDPR and HR practices – IN A NUTSHELL

The acronym GDPR has been on the lips of many business owners in recent months and with the wide variety of effects on different organisational functions to consider, one may be forgiven for believing it should stand for Good Day to Panic & Run!

But, there’s no need to worry as long as you take steps to put manageable adjustments in place that will ensure your business is compliant with the General Data Protection Regulation by 25th May 2018.

This blog has been put together to specifically help you understand what GDPR means for the HR practices in your business, with the aim of helping ensure you’re anxiety free and ready to go when the deadline arrives.

Why will GDPR affect HR practices?

With increasingly globalised networks and a shift to online communications, GDPR has been put in place to protect the personal data of EU citizens and will apply even though the UK will be leaving the EU, due to the fact that at the time of GDPR coming in to force we will still be part of the EU and are therefore bound by the requirements.

It’s the biggest change to hit how data is regulated in 20 years during which time much has changed.  As a data protection regulation, the changes will mean that all organisations will need to review how they handle the data of employees as well as job candidates, ensuring processes are put into place to guarantee compliance.   If businesses fail to comply and are found to be in breach of the regulations, they could end up penalised as a result.

Privacy Notices

A privacy notice is used to inform people how their personal data will be used by an organisation in as transparent and accessible way as possible. In preparation for GDPR, privacy notices must now clearly outline the intended use of data, including detail such as how long the data will be stored, and whether this data is shared with other countries within and outside of the EU. Individuals should also be clearly directed to the organizational process for making a subject access request to view information about them held by the organisation if they wish to do so.

What should you do? Job applicants and interview candidates should be directed to a privacy notice when sending personal information as part of the recruitment process. Privacy notices should also be shared with new and existing employees with regards to their personal employment records.

Protecting the data of your staff

In addition to GDPR rules, it should be considered ethical that companies take full responsibility and ownership when it comes to protecting employee data, how it is kept and ensuring it is not shared. Personal data you may hold about employees and job candidates would more than likely include sensitive information such as home address, date of birth, contact details, and after recruitment, national insurance numbers and bank account details.

What should you do?  First and foremost you should review your organisational processes for obtaining, handling and storing CV’s, job applications and employee information. There are many ways you can protect this data including the implementation of encrypted passwords on secure servers and deleting securely any data relating of unsuccessful candidates after a given period of time. If you use outsourced services like payroll or candidate verification, check their compliance with GDPR too. You may also want to consider outsourcing a cyber security procedure and taking out cyber insurance. If you don’t use an HR database yet, this may be worth implementing along with reviewing the need for hard copy HR files.

New breach notification requirement

If there is a breach of data protection, GDPR provides clear guidelines on the action that must be taken after receiving a breach notification. Businesses must inform the Data Protection Agency within 72 hours of a breach, or provide justification in the event of a delay. Businesses must also notify individuals affected by a data breach promptly and directly, particularly if the breach presents a high risk to the data subject’s rights and freedoms.

What should you do? If a breach originates from HR related activity, whoever is responsible in your organisation for HR must liaise with legal or compliance teams immediately. The same person with the organizational HR lead is also likely to play a key role in the management of data breaches affecting employee data that require data subject notification. Businesses must also take action to review internal HR and business policies and procedures.

Right to request, review and be removed

If you currently take a ‘one size fits all’ approach with regard to obtaining consent to hold staff data and to communicate to previous candidates or job applicants, you will probably need to think again.  Moving forward “specific, informed and unambiguous” consent must be obtained. Current methods of gaining consent (often via a contract of employment) must be reviewed to eliminate any uncertainty about what data is being collected, its purpose, the length of time consent will remain valid, and the process for withdrawing consent at any time. Individuals will also be able to request at any time, to know what data you hold about them, where it is kept, and how it is used.

What should you do?  You must respond to requests and act upon them, so you may want to put in place a procedure that is shared with your senior management team on what to do in the event they get approached by an individual for this information. The likelihood is also, that all current staff members will need new contracts containing updated consent requests.

Consequences for staff of non GDPR compliance

It’s really important that all your staff are aware of this significant change to how data is managed and protected as it will impact on many aspects of your business.  In particular they need to understand that data can’t be shared without explicit consent (no matter how good the intention for doing so is) and that there may be serious personal consequences of something like a data breach if it was due to poor data security practices.

What you should do? Identify who needs to be trained, what they need to know and who will do this. Check existing policies to see if they need updating to reflect GDPR. Eg Disciplinary policy to capture Serious data security and/or data breach as gross misconduct.  Review all internal communications and current data storage systems. Don’t forget email which can harbor all sorts of highly confidential personal data.

Data Protection Officers 

Businesses that handle special categories of data or data relating to criminal convictions and offences (sometimes included on recruitment applications) must have a designated Data Protection Officer (DPO). A DPO is someone who takes on additional responsibilities for implementing processes and monitoring compliance with GDPR and advising individuals and teams on GDPR compliant approaches to data management.

What should you do? It may be worth considering appointing a nominated ‘senior’ member of staff either from within your organisation, or someone external to the company, to act as a DPO for your organisation.

 IF YOU WANT ANY HELP OR ADVICE please get in touch with us at Amelore by calling 01453 548070 or emailing ruthcornish@amelore.com.

GDPR – Managing HR & Payroll records

As preparations for GDPR continue, All employers must be aware of which employee data is covered by the Data Protection Act and have a specific policy on the retention times for particular types of employee data.

As a general rule, information should only be retained as long as there is a clear business need for it and it should be securely destroyed (e.g. by shredding) after that period has passed.

Minimum retention times for employee data are as follows:

  1. Salary Records and Deductions

Records to be retained: Employers must collect and keep records of what they pay their employees and the deductions made, including a record of employee leave and sickness absence (see below).

Retention period: Three years after the end of the tax year to which the records relate. If full records are not kept, HM Revenue and Customs (HMRC) may estimate what the employer has to pay and charge a penalty of up to £3,000.

  1. Incapacity for Work

Records to be retained: Employers should keep Statutory Sick Pay (SSP) records (calculations, certificates, self-certificates: all sickness periods lasting at least four days; statutory sick pay (SSP) payments; and weeks for which SSP was not paid and why.

Retention period: Three years after the end of the tax year in which the sickness periods occurred and SSP payments were made.

  1. Working Time

Records to be retained: Records that are adequate to show that the requirements of the Working Time Regulations are being/have been met e.g. the limits on weekly working time, daily and weekly working time for young workers, and night work.

Retention period: Two years from the date on which the records were made.

  1. National Minimum Wage

Records to be retained: Records that are adequate to establish that every worker is being, or has been, paid at a rate at least equal to the National Minimum Wage.

Retention period: Three years from the day the pay reference period immediately following that to which the records relate ends.

  1. Absence during Pregnancy and Statutory Maternity Pay (SMP)

Records to be retained:

  • the date of an employee’s first day of absence from work, wholly or partly because of pregnancy or childbirth and, if different, the date of the first day when such absence commenced;
  • the weeks in that tax year in which Statutory Maternity Pay (SMP) was paid to that employee and the amount paid in each week;
  • any week in that tax year within the employee’s maternity pay period for which no payment of SMP was made (and the reasons why); and
  • any medical certificate or other evidence relating to the employee’s expected week of childbirth.

Retention period: Three years after the end of the tax year in which the employee’s maternity pay period ended.

  1. Statutory Paternity Pay, Statutory Shared Parental Pay and Statutory Adoption Pay

Records to be retained:

  • the date the paternity pay period, shared parental pay period or adoption pay period began;
  • the evidence provided by the employee in support of his or her entitlement to statutory paternity pay (SPP), statutory shared parental pay (ShPP) or statutory adoption pay (SAP);
  • the weeks in that tax year in which payments of SPP, ShPP or SAP were made and the amount paid in each week; and
  • any week in that tax year which was within the employee’s paternity pay period, shared parental pay period or adoption pay period but for which no payment was made (and the reasons why).

Retention period: Three years after the end of the tax year in which payments of SPP, ShPP or SAP were made.

  1. Employee HR files

Records to be retained:  HR files, including employee contracts.

Retention period: Six years after the employment terminates. This takes into account that there is the possibility that any documents relating to an employee could be relevant to a Tribunal, County Court or High Court claim, for up to six years after termination of employment. The Information Commissioner considers this as acceptable on the basis that an employer is keeping information to protect against legal risk.

  1. Job Applications

Records to be retained: CVs/application forms and interview records of unsuccessful candidates.

Retention period: Six months after notifying unsuccessful candidates of the outcome of their application. This takes into account the fact that a job applicant can bring a claim for discrimination in an Employment Tribunal within three months from the date of the rejection for the role, but also that this time limit can be extended where a Tribunal feels it is just and equitable to do so.

  1. Accident Records

Records to be retained: Records of accidents in the workplace.

Retention period: At least three years from the date on which the accident record was made.

Accident records are considered sensitive data and so employers must ensure that the personal information involved is not seen by other members of staff.